Chapter 01 Introduction True / False Questions Efficiency means doing the right things to create the most value for the company True False Effectiveness means doing the right things to create the most value for the company True False A doctor completes a surgical procedure on a patient without error The patient dies anyway In operations management terms, we could refer to this doctor as being efficient but not effective True False A worker can be efficient without being effective True False A process can be effective without being efficient True False Operations and supply chain management is defined as the design, operation, and improvement of the systems that create and deliver the firm's primary products and services True False The term "value" refers to the relationship between quality and the price paid by the consumer True False Attempting to balance the desire to efficiently use resources while providing a highly effective service may create conflict between the two goals True False 1-1 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part Central to the concept of operations strategy are the notions of operations focus and trade-offs True False 10 OSCM is concerned with management of the trickiest parts of the system that produces a good or delivers a service True False 11 OSCM is a functional field of business with clear line management responsibilities True False 12 The supply network as can be thought of as a pipeline through which cash, material and information flows True False 13 Supply networks cannot be constructed for every product or service True False 14 "Operations" refers to manufacturing and service processes used to transform resources employed by a firm into products desired by customers True False 15 "Supply chain" refers to processes that move information and material to and from the manufacturing and service processes of the firm True False 16 "Supply chain" includes only inbound freight and inventory True False 17 It is critical that a sustainable strategy meet the needs of shareholders and employees It is also highly desirable that it preserves the environment True False 18 Planning is where a firm must determine how anticipated demand will be met with available resources True False 1-2 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 19 Although planning involves determining how the various supply chain processes (sourcing, making, delivering, and returning) will be met, planning itself is not considered a supply chain process True False 20 The supply chain processes mentioned in the textbook are planning, sourcing, delivering, and returning True False 21 All managers should understand the basic principles that guide the design of transformation processes True False 22 Operations and supply management changes constantly because of the dynamic nature of competing in global business and the constant evolution of information technology True False 23 Internet technology has made the sharing of reliable real-time information expensive True False 24 Capturing information directly from the source through such systems as point-of-sale, radio-frequency identification tags, bar-code scanners, and automatic recognition has had little impact on operations and supply chain management True False 25 Use of systems like point-of-sale, radio-frequency identification tags, bar-code scanners, and automatic recognition has made it more difficult to understand what all the information is saying True False 26 Operations and supply chain processes can be conveniently categorized as planning, sourcing, making, and delivering True False 27 A major aspect of planning involves developing a set of metrics to monitor the supply chain True False 1-3 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 28 Returning involves processes for receiving worn-out, defective, and excess products back from customers but does not involve support for customers who have problems with the product True False 29 Delivering is not considered in supply chain analysis when outside carriers are contracted to move products to customers True False 30 Services are intangible processes that cannot be weighed or measured True False 31 Service innovations can be patented True False 32 Services are homogeneous True False 33 Services are defined and evaluated as a package of features that affect the five senses True False 34 Automobiles and appliances are classified as "pure goods." True False 35 Core service providers integrate tangible goods into their product True False 36 "Product-service bundling" refers to a company building service activities into its product offerings for its customers True False 37 In contrast to careers in finance and marketing, careers in OSCM involve hands-on involvement with people and processes True False 38 A bank branch manager position is not an OSCM-type of job True False 1-4 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 39 A supply chain manager is an OSCM job while a purchasing manager is not True False 40 Just-in-time (JIT) production was a major breakthrough in manufacturing philosophy pioneered by the Japanese True False 41 Lean manufacturing refers to just in time production coupled with total quality control True False 42 The Baldrige National Quality Award was started under the direction of the National Institute of Standards and Technology True False 43 The approach that advocates making revolutionary changes as opposed to evolutionary changes is called "creation theory." True False 44 The approach that advocates making revolutionary changes as opposed to evolutionary changes is called "business process reengineering." True False 45 Business process reengineering, which seeks revolutionary change, is contrasted with total quality management which commonly advocates incremental change True False 46 The "triple bottom line" relates to the economic, employee, and environmental impact of a firm's strategy True False 47 Sustainability is the ability to maintain profits in a system True False 48 Raising senior management awareness of OSCM as a competitive weapon is not an important issue True False 1-5 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 49 "Green belt" programs are coordinated public works projects aimed a placing an environmentally friendly zone around major cities True False 50 Green and black belt programs teach six-sigma quality tools to managers at many corporations True False 51 The central idea of supply chain management is to apply a total system approach to managing the flow of information, materials, and services from raw material suppliers through factories and warehouses to the end customer True False 52 The term "electronic commerce" refers to the buying and selling of electronic products and devices True False 53 The term "electronic commerce" refers to the use of the Internet as an essential element of business activity True False 54 SSME is an acronym standing for "service sector management economics." True False 55 Service science management and engineering aims to apply the latest concepts in information technology to continue to improve service productivity of technologybased organizations True False 56 "Business analytics" involves the analysis of data through a unique combination of linear programming, game theory, and queuing theory to better solve business problems True False 57 The mathematical results of Business Analytics are used to automate decision making and eliminate the decision maker True False 1-6 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 58 Operations and supply chain strategy are not important issues to investors who tend to focus on growth, dividends, and earnings per share True False 59 Investors pay close attention to efficiency and productivity measures like net income per employee because they are interested in how well the firm manages its workforce relations True False 60 During a recession, efficient firms often have an opportunity to increase market share while maintaining profitability True False 61 Wall Street analysts are not particularly concerned with how efficient companies are from an operations and supply management view True False Multiple Choice Questions 62 One reason for studying operations and supply chain management (OSCM) is which of the following? A B C D E OSCM is essential for understanding organizational behavior Most business graduates OSCM work regardless of their job title All managers should understand the basic principles that guide the design of trans OSCM is a required course in all business degree programs OSCM is the most rigorous business discipline 63 The goods-services continuum consists of which set of the following categories? A B C D E No goods, some goods, even mix, some service, no service Pure goods, core goods, core services, pure services No service, some service, good service, excellent service Self-service, help desk service, face-to-face service, service-with-a-smile 1-7 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 64 Which of the following are defined as core goods? A B C D E Data storage systems 65 Current issues in OSCM not include: A B C D E Coordinating relationships between organizations Making senior management aware that OSCM can be a competitive weapon The triple bottom line Managing customer touch points Increasing global supply chain employment 66 Which of the following are not listed in the text as jobs in OSCM? A B C D E Department store manager Hospital administrator Data center manager Call center manager 67 Which of the following is not a characteristic that distinguishes services from goods? A B C D E Service jobs are unskilled A service is intangible Services are perishable Services are heterogeneous 68 Which of the following is not a way that operations and supply processes are categorized? A B C D E 1-8 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 69 One of the "package of features" that make up a service is: A B C D E 70 Which of the following is not a measure of operations and supply chain management efficiency used by Wall Street? A B C D E Inventory turno Revenue per employee Receivable turnove Earnings per sh 71 Which of the following is a measure of operations and supply management efficiency used by Wall Street? A B C D E Dividend payout ratio Receivable turnove Earnings per share growth Financial leverag Fill in the Blank Questions 72 The ability to maintain balance in a system is referred to as 73 Processes that are used to transform resources into products are called _ 1-9 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 74 What are the five categories of supply chain processes? _ _ _ _ _ 75 Doing something at the lowest possible cost is called: _ 76 Value is the ratio of 77 A pipeline through which material and information flows is a conception of a 78 List five OSCM job titles _ _ _ _ _ 79 What are four current issues in operations and supply management that are discussed in the textbook? _ _ _ _ 80 What is a total systems approach to managing the flow of information, materials, and services from raw material suppliers through factories and warehouses to the end customer called? 1-10 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 67 Which of the following is not a characteristic that distinguishes services from goods? A Se rvi ce jo bs ar e un sk ill ed BA se rvi ce is int an gi bl e C Se rvi ce s ar e pe ris bl e 1-53 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part D Se rvi ce s ar e he te ro ge ne ou s EN o n e of th es e Many service jobs are highly skilled such as physician, attorney, airline pilot, OSCM instructor, etc The characteristics that distinguish goods from services are: Tangibility Interaction with the customer Services are heterogeneous Services are perishable and time dependent Services are seen as a package of features that affect the five senses AACSB: Analytic Blooms: Apply Difficulty: Medium Learning Objective: 01-01 Define organizational behavior and organizations; and discuss the importance of this field of inquiry Topic: Differences between Services and Goods 1-54 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 68 Which of the following is not a way that operations and supply processes are categorized? APl a n ni n g BR et u r n CD el iv er y DS el e ct in g EM a ki n g Operations and supply chain processes can be conveniently categorized as planning, sourcing, making, delivering, and returning AACSB: Analytic Blooms: Remember Difficulty: Medium Learning Objective: 01-01 Define organizational behavior and organizations; and discuss the importance of this field of inquiry Topic: Operations and Supply Chain Processes 1-55 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 69 One of the "package of features" that make up a service is: AA p p e ar a nc e B Fa cil ita ti ng go od s CP a ck a gi n g DC o s t EI m pl ie d us e The package of features that make up a service is listed in the text and includes facilitating goods AACSB: Analytic Blooms: Apply Difficulty: Medium Learning Objective: 01-01 Define organizational behavior and organizations; and discuss the importance of this field of inquiry Topic: Differences between Services and Goods 1-56 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 1-57 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 70 Which of the following is not a measure of operations and supply chain management efficiency used by Wall Street? AIn ve nt or y tu rn ov er BRe ve nu e pe r e m pl oy ee CRe ce iv ab le tu rn ov er D Ea rn in gs pe r sh ar e 1-58 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part EAs se t tu rn ov er Earnings per share is not a measure of operations and supply chain efficiency See Exhibit 1.6, "Efficiency Measures Used by Wall Street." AACSB: Analytic Blooms: Remember Difficulty: Easy Learning Objective: 01-04 Discuss the anchors on which organizational behavior knowledge is based Topic: Efficiency, Effectiveness, and Value 1-59 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 1-60 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 71 Which of the following is a measure of operations and supply management efficiency used by Wall Street? ADi vi de nd pa yo ut tio BC ur re nt ti o C Re ce iv ab le tu rn ov er D Ea rni ng s pe r sh ar e gr o wt h 1-61 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part EFi na nc ial le ve ge Receivables turnover, the correct answer, is listed in Exhibit 1.6 "Efficiency Measures Used by Wall Street." AACSB: Analytic Blooms: Remember Difficulty: Easy Learning Objective: 01-04 Discuss the anchors on which organizational behavior knowledge is based Topic: Efficiency, Effectiveness, and Value Fill in the Blank Questions 72 The ability to maintain balance in a system is referred to as sustainability Sustainability is the ability to maintain balance in a system AACSB: Analytic Blooms: Remember Difficulty: Easy Learning Objective: 01-03 Debate the organizational opportunities and challenges of globalization; workforce diversity; and emerging employment relationships Topic: Current Issues in Operations and Supply Chain Management 73 Processes that are used to transform resources into products are called _ operations Operations refers to manufacturing and service processes that are used to transform the resources employed by a firm into products desired by customers AACSB: Analytic Blooms: Remember Difficulty: Easy Learning Objective: 01-01 Define organizational behavior and organizations; and discuss the importance of this field of inquiry 1-62 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part Topic: Operations and Supply Chain Processes 74 What are the five categories of supply chain processes? _ _ _ _ _ planning; sourcing; making; delivering; returning The list of operations and supply chain processes—planning, sourcing, making, delivering, and returning-is given in the text AACSB: Analytic Blooms: Remember Difficulty: Medium Learning Objective: 01-01 Define organizational behavior and organizations; and discuss the importance of this field of inquiry Topic: Operations and Supply Chain Processes 75 Doing something at the lowest possible cost is called: _ efficiency Efficiency means doing something at the lowest possible cost AACSB: Analytic Blooms: Remember Difficulty: Easy Learning Objective: 01-04 Discuss the anchors on which organizational behavior knowledge is based Topic: Efficiency, Effectiveness, and Value 76 Value is the ratio of quality to price paid Related to efficiency and effectiveness is the concept of value, which can be metaphorically defined as quality divided by price AACSB: Analytic Blooms: Apply Difficulty: Medium Learning Objective: 01-04 Discuss the anchors on which organizational behavior knowledge is based Topic: Efficiency, Effectiveness, and Value 1-63 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 77 A pipeline through which material and information flows is a conception of a supply network Think of the supply network as a pipeline through which material and information flows AACSB: Analytic Blooms: Apply Difficulty: Medium Learning Objective: 01-01 Define organizational behavior and organizations; and discuss the importance of this field of inquiry Topic: What Is Operations and Supply Chain Management? 78 List five OSCM job titles _ _ _ _ _ any five from the list in the text A list of OSCM job titles is found under careers in OSCM in the text AACSB: Analytic Blooms: Apply Difficulty: Medium Learning Objective: 01-02 Compare and contrast the four current perspectives of organizational effectiveness as well as the early goal attainment perspective Topic: Careers in Operations and Supply Chain Management 79 What are four current issues in operations and supply management that are discussed in the textbook? _ _ _ _ (any four): Coordinating relationships between mutually supportive but separate organizations; Optimizing global supplier, production, and distribution networks; Managing customer touch points; Raising senior management awareness of operations as a significant competitive weapon; Sustainability and the triple bottom line AACSB: Analytic Blooms: Understand 1-64 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part Difficulty: Hard Learning Objective: 01-03 Debate the organizational opportunities and challenges of globalization; workforce diversity; and emerging employment relationships Topic: Current Issues in Operations and Supply Chain Management 80 What is a total systems approach to managing the flow of information, materials, and services from raw material suppliers through factories and warehouses to the end customer called? supply chain management The central idea of supply chain management is to apply a total system approach to managing the flow of information, materials, and services from raw material suppliers through factories and warehouses to the end customer AACSB: Analytic Blooms: Remember Difficulty: Medium Learning Objective: 01-01 Define organizational behavior and organizations; and discuss the importance of this field of inquiry Topic: What Is Operations and Supply Chain Management? 81 What is a major industry and university program aiming to apply the latest concepts in information technology to continue to improve service productivity of technology-based organizations called? _ service science management and engineering (SSME) A direct response to the growth of services is the development of a major industry and university program called service science management and engineering (SSME) SSME aims to apply the latest concepts in information technology to continue to improve service productivity of technology-based organizations AACSB: Analytic Blooms: Remember Difficulty: Medium Learning Objective: 01-03 Debate the organizational opportunities and challenges of globalization; workforce diversity; and emerging employment relationships Topic: Historical Development of Operations and Supply Chain Management 82 The use of the Internet as an essential element of business activity is called what? electronic commerce The term "electronic commerce" refers to the use of the Internet as an essential element of business activity AACSB: Analytic 1-65 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part Blooms: Remember Difficulty: Medium Learning Objective: 01-03 Debate the organizational opportunities and challenges of globalization; workforce diversity; and emerging employment relationships Topic: Historical Development of Operations and Supply Chain Management 83 Name five common measures of operations and supply management efficiency used by Wall Street _ _ _ _ _ The five common measures of operations and supply management efficiency used by Wall Street are income per employee; revenue per employee; inventory turnover; asset turnover; receivable turnover-which are among the typically used measures by Wall Street AACSB: Analytic Blooms: Remember Difficulty: Medium Learning Objective: 01-04 Discuss the anchors on which organizational behavior knowledge is based Topic: Efficiency, Effectiveness, and Value Essay Questions 84 Discuss the role of efficiency and effectiveness in the creation of value A successful response to this question requires a definition of "value" (a relationship between "quality" or "performance" of a product and its price) and discussion of the trade-off between efficiency and effectiveness Creating value means striking the most appropriate balance between efficiency and effectiveness for the market need the product will satisfy Feedback: These concepts are discussed in depth in the textbook under the topic AACSB: Analytic Blooms: Understand Difficulty: Medium Learning Objective: 01-04 Discuss the anchors on which organizational behavior knowledge is based Topic: Efficiency, Effectiveness, and Value 1-66 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part 1-67 © 2014 by McGraw-Hill Education This is proprietary material solely for authorized instructor use Not authorized for sale or distribution in any manner This document may not be copied, scanned, duplicated, forwarded, distributed, or posted on a website, in whole or part ... Is Operations and Supply Chain Management? 26 Operations and supply chain processes can be conveniently categorized as planning, sourcing, making, and delivering FALSE Operations and supply chain. .. inquiry Topic: Operations and Supply Chain Processes 20 The supply chain processes mentioned in the textbook are planning, sourcing, delivering, and returning FALSE Operations and supply chain processes... behavior and organizations; and discuss the importance of this field of inquiry Topic: What Is Operations and Supply Chain Management? 15 "Supply chain" refers to processes that move information and